A technology-focused venture capital firm is using聽artificial intelligence (AI) to look for new European investment opportunities and find the next tech unicorn.
Andreas Thorstensson is tech partner and investment adviser at EQT Ventures, which went live in 2016 and is part of global private equity group EQT.
The Swedish developer, gamer, entrepreneur and former chief technology officer of peer-to-peer lending company Toborrow joined the team with the aim of disrupting the traditional venture capital industry using software.
He has since helped to build and configure a 鈥榮ignal intelligence鈥� AI platform called Motherbrain, developed with the very specific job of proactively looking for tech companies that he calls 鈥榙iamonds in the rough鈥�.
In simple terms, the software collects data from at least 20 online sources and analyses up to 50 metrics to find companies that could be the next big thing before anyone else notices.
鈥淭here are many tech companies that don鈥檛 really get the attention of VCs because they don鈥檛 know the right people or they鈥檙e not attending the right conferences, or maybe they鈥檙e based in small towns and can鈥檛 get access to them,鈥� Thorstensson said.
鈥淲e created Motherbrain to adopt a pure data-driven approach of sifting through the noise.鈥�
EQT Ventures has been using Motherbrain internally for almost two years, with the platform now responsible for up to 30 per cent of the fund’s deal flow.
Thanks to the software, the firm has already backed two tech companies which Thorstensson says would have otherwise likely remained under the radar. Motherbrain is also now being used across EQT鈥檚 broader platform.
Although unlikely to ever replace the traditional model or make actual investment decisions, Thorstensson says there鈥檚 a clear trend that more and more VCs are realising the benefit of investing in AI platforms and data-driven systems to assist with discovery.
鈥淚f you look at the kind of companies we鈥檙e interested in, 1,600 of those are created on a daily basis and about 150 of them get funding,” he said.
鈥淚n the near future, every single VC is going to have a much more data-driven approach when it comes to deal sourcing 鈥� that鈥檚 going to be key going forward.”